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Turkey’s central bank governor Naci Abal was ousted and replaced by economist and politician Sahak Kavtzioglu, according to a presidential decree issued late Friday.
The development was announced the day after the 2% increase in the key interest rate of Turkey’s central lending institution to 19%. The central bank explained that the measure was aimed at curbing inflation, which rose at an annual rate of 15.6% in February. The measure was well received in the markets.
Abal, a former finance minister, has not been in office for a long time since he took office last November, when he was appointed by Recep Tayyip Erdogan to reorganize his finance team.
The Turkish president openly opposes high interest rates, challenging classical economic theories as he believes they are exacerbating inflation.
The new head of the Turkish central bank, whose appointment was announced on Friday night after the capital markets closed, will become the fourth governor from July 2019.
The Turkish lira recovered about 15 percent of its value against the dollar after Abal took office in November after weeks of free fall in the currency.
Source: ΑΠΕ-ΜΠΕ
